Verizon Q1 on track, $195 million in IoT revenue, 640,000 postpaid wireless additions

Verizon's first quarter was in line with expectations as the company added 640,000 retail postpaid customers and delivered $195 million in Internet of things revenue.

The telecom giant reported first quarter earnings of $1.06 a share on revenue of $32.2 billion, up 0.6 percent from a year ago. If AOL was excluded, which wasn't part of Verizon a year ago, revenue would have fell 1.5 percent.

Verizon added that AOL had its highest first quarter revenue tally in five years. AOL is part of a broader strategy for Verizon to grow as the smartphone and wireless markets mature to the point of saturation.

Here's the master plan in a nutshell.

But before those growth plays work out, Verizon, which is also said to be bidding for Yahoo, needs to continue to milk its wireless business.

On the wireless front, Verizon is performing well. The company ended the first quarter with 112.6 million retail connections, up 3.7 percent from a year ago. Of that sum, 107.2 million customers had retail postpaid connections. Churn was 0.96 percent in the first quarter.

Operating income for Verizon's wireless business was $7.9 billion in the first quarter on revenue of $22 billion, down 1.5 percent. Sixty eight percent of customers were on installment plans in the first quarter and 81 percent of the retail postpaid base had 4G devices.

As for wireline, Verizon added 98,000 new FioS connections and 36,000 new video customers in the first quarter.

Verizon said its 2016 earnings will be on par with what was delivered in 2015 on an adjusted basis. The wild cards are cost cuts and labor contract negotiations.